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United States
Securities and Exchange Commission
Washington, D.C. 20549
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FORM 11-K
(MARK ONE)
[x] Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of
1934 For the Period from July 1, 1999 through December 31, 1999
or
[ ] Transition Report Pursuant to Section 15(d) of the Securities Exchange Act
of 1934 For the transition period from _________ to _________
Commission file number 333-85535
Saga Communications, Inc. Employee Stock Purchase Plan
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(Full title of plan)
Saga Communications, Inc.
73 Kercheval Avenue
Grosse Pointe Farms, Michigan 48236
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(Name of Issuer of Securities Held Pursuant to Plan and
Address of its Principal Executive Office)
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Saga Communications, Inc.
Employee Stock Purchase Plan
Financial Statements for the
Period from July 1, 1999 to December 31, 1999
with Report of Independent Auditors
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SAGA COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
FINANCIAL STATEMENTS
DECEMBER 31, 1999
TABLE OF CONTENTS
Page
Report of Independent Auditors 4
Financial Statements
Statement of Financial Condition 5
Statement of Income and Changes in Plan Equity 6
Notes to Financial Statements 7
Other Information
Signatures 10
Exhibit 23 - Consent of Independent Auditors 11
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Report of Independent Auditors
Plan Administrator
Saga Communications, Inc.
Employee Stock Purchase Plan
We have audited the accompanying statement of financial condition of the Saga
Communications, Inc. Employee Stock Purchase Plan as of December 31, 1999 and
the related statement of income and changes in plan equity for the period from
July 1, 1999 to December 31, 1999. These financial statements are the
responsibility of the Plan's administrator. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by the Plan Administrator, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Saga Communications
Employee Stock Purchase Plan at December 31, 1999 and the results of its
operations and changes in its plan equity for the period from July 1, 1999 to
December 31, 1999 in conformity with accounting principles generally accepted in
the United States.
/s/ Ernst & Young LLP
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March 15, 2000
Detroit, Michigan
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SAGA COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
STATEMENT OF FINANCIAL CONDITION
DECEMBER 31, 1999
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Class A Common Stock of Saga Communications, Inc. at
fair value (3,309 shares at a cost of $67,007) $ 67,007
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PLAN EQUITY:
Plan equity (78 participants) $ 67,007
=========
</TABLE>
See accompanying notes.
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SAGA COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY
FOR THE PERIOD FROM JULY 1, 1999 TO DECEMBER 31, 1999
<TABLE>
<CAPTION>
<S> <C>
ADDITIONS:
Participant contributions $ 56,957
Employer contributions 10,050
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67,007
DEDUCTIONS:
Plan distributions --
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67,007
Net realized and unrealized appreciation in fair
value of investments --
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Net increase 67,007
Plan equity-beginning of period --
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Plan equity-end of period $ 67,007
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</TABLE>
See accompanying notes.
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SAGA COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
1. DESCRIPTION OF PLAN
In 1999, the stockholders of Saga Communications, Inc. ("Company") approved the
Saga Communications, Inc. Employee Stock Purchase Plan ("the Plan") under which
1,250,000 shares of the Company's Class A Common Stock could be sold to the
Company's employees. The Plan was effective July 1, 1999, and employees were
eligible to begin contributing on October 1, 1999. Each calendar year quarter an
offering is made to eligible employees to purchase Class A Common Stock of the
Company under the provisions of the Plan. An eligible employee may elect to
withhold up to 10 percent of his or her compensation (up to a limit of $25,000
per year) to purchase shares of the Company's stock at a price equal to 85
percent of the fair value of the stock as of the last day of such quarter.
Participants are not permitted under the Plan to dispose of any shares purchased
under the Plan within two years after the later of (i) the beginning of the
quarter in which a deduction was taken from the participant's compensation for
the purchase of the shares, or (ii) the expiration of one year from the date the
shares were transferred to the participant. An employee shall be eligible to
participate in the Plan if he or she is employed by the Company or any of its
subsidiaries and 1) customarily works a minimum of 20 hours per week and 2) has
completed six consecutive months of service. Participants are immediately 100%
vested in the Plan.
Shares are purchased on the last day of each quarter. There were 3,309 shares
issued under the Plan in 1999. Employer contributions related to the Plan in
1999 were approximately $10,000.
The Plan will terminate upon the issuance of 1,250,000 shares pursuant to the
Plan, unless an extension of the Plan is approved by the stockholders of the
Company. In any event, the Plan will not continue beyond December 31, 2008. The
Company currently has no intention of terminating the Plan.
2. SIGNIFICANT ACCOUNTING POLICIES
ADMINISTRATIVE EXPENSES
The costs of administering the Plan shall be borne by the Company unless and
until a participant receives written notice of the imposition of administrative
costs, with such costs to begin effective with the next offering as described in
Note 1. Currently, the Company pays all administrative fees and costs associated
with the Plan. Brokerage fees or commissions when Class A Common Stock is sold
are paid by participants.
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SAGA COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles in the United States requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
FAIR VALUE OF INVESTMENT
The fair value of common stock held in the Plan is based on the closing price of
the Company's Class A Common Stock at year end (December 31, 1999).
3. INCOME TAX STATUS
The Plan qualifies as an employee stock purchase plan under Section 423 of the
Internal Revenue Code ("Code") which allows employees to purchase stock at a
discount without immediate taxation on the amount of the discount. The Plan is
not subject to the Employee Retirement Income Security Act of 1974 ("ERISA").
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EXHIBIT INDEX
Exhibit
23(a) Consent of Ernst & Young LLP
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
administrator of the Plan has duly caused this annual report to be signed on its
behalf by the undersigned thereunto duly authorized.
SAGA COMMUNICATIONS, INC.
EMPLOYEE STOCK PURCHASE PLAN
Date: March 29, 2000 /s/ Marcia K. Lobaito
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Marcia K. Lobaito
Plan Administrator
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Exhibit 23 - Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 333-85535) pertaining to the Employee Stock Purchase Plan of Saga
Communications, Inc. of our report dated March 15, 2000, with respect to the
financial statements of the Saga Communications, Inc. Employee Stock Purchase
Plan included in this Annual Report (Form 11-K) for the period from July 1, 1999
to December 31, 1999.
/s/ Ernst & Young LLP
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Detroit, Michigan
March 28, 2000
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